At the Commission`s presentation on the annual progress reports in January 2009, the Commission stated that recent member states` efforts to implement the Lisbon Strategy provided "a strong basis" for the future. In reality, the EU`s goal of becoming the most dynamic knowledge-based economy by 2010 is no more than an illusion.The figures in the Commission report reveal that the member states are far from implementing the agreed Lisbon Strategy-policy. The EU`s target of ensuring that 70% of Europeans take part in the labour market appears out of reach since the current rate is 65.5%. In areas that are seen as key to keeping Europe competitive, like R&D investment and high-speed Internet access,there is stagnation. Spending on R&D and innovation remains at a stable low of 1,84% of GDP, with only Sweden and Finland performing above the 3% agreed in the Lisbon Strategy.

Expanding broadband coverage across the EU is vital to maintain the Union`s innovative base and competitiveness, but still only 30% of the EU`s rural population has Internet access. In addition, when trying to expand their business, small and medium-sized businesses (SMEs) are facing considerable bureaucratic obstacles when they deal with national administration and the European Commission.

Programmes to stimulate life-long-learning have not met with much success either. Although the current economic crisis highlights the need to upgrade the skills needed in the labour market, many European countries are cutting funds for life-long-learning programmes. Furthermore, public expenditure on education decreased from 5,2% to 5% of national GDP.

We have to conclude that the Lisbon Strategy designed to make the EU "the most dynamic and competitive knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion,and respect for the environment by 2010" has failed due to a lack of commitment by the member states and the absence of binding instruments at the EU-level.

The European Commission had to take much of the blame for the current economic crisis, but does not have the requisite tools to make member states honour their commitments. Therefore, the European Liberals and Democrats are proposing a strategic partnership between the European Parliament and the Commission,providing the Commission with the necessary powers to make the "EU 2020" strategy a success.

It is of paramount importance to the nearly 80 million Europeans who live below the poverty line that the Commission will have the power to play a more central role in steering the EU into an era of economic growth. This enhanced role for the European Commission should go together with a radical change in the working methodology of the post-Lisbon strategy.

Therefore, European Liberals and Democrats insist that the "EU 2020" agenda should not be based on the same weak basis of "open coordination", using the "exchange of best practices" and "peer pressure". It should not be the member states, but the European Commission which controls the agenda by fixing the objectives and defining the corresponding policy action to be pursued at EU and member state level.

In the attached paper the reader will find our recommendations for a reformed strategy as an alternative to the failing "open coordination method". It gives the Commission a central role in drafting a common European economic orientation policy, based on reform projects for individual countries. The Commission should have the power to examine every national measure and decide if these comply with the criteria of the post-Lisbon agenda.

European Liberals and Democrats believe that further integration should not be based on the lowest common denominator. Therefore, the Commission should encourage member states to form groups of countries to spearhead progress in the Internal Market. Additionally, the EU must overhaul its budget, prioritising economic growth and job creation.

The Commission should have more sticks and carrots at its disposal to make the member states live up to their commitments. This would mean additional structural funds for member states who deliver credible action plans and results, but at the same time financial penalties for member states that are not providing National Management Declarations indicating the correct spending of European money on the "EU 2020" goals.

In March 2010 the Commission will present its final "EU 2020" strategy. By coming forward with bold proposals to put the European Commission in the driver seat of economic growth and jobs in the next decade, it will find a strong ally in the Alliance of Liberals and Democrats for Europe.

Guy VerhofstadtGroup Leader of the Alliance of Liberals and Democrats for Europe